Toyota Motor has formed a tie-up with electronics maker Panasonic to set key standards for batteries used in electric vehicles.

According to the Nikkei Asian Review, this move could help the Japanese auto industry catch up to foreign rivals in the electric vehicle market.

Toyota subsidiary Daihatsu Motor and capital partner Mazda Motor will likely be a part of this tie-up.

Other major automakers like Honda Motor could also be invited to help craft battery standards, potentially turning the partnership into a major consortium for the development of electric-vehicle batteries.

One of the main goals of the tie-up is to entice more manufacturers to join in, ensuring a steady flow in the recycling of used batteries, thereby reducing the cost of making batteries. EV battery production alone accounts for the bulk of production costs associated with electric vehicles.

Toyota has historically put more energy into developing and commercializing hydrogen fuel cell vehicles in Japan than electric cars, seeing the latter as expensive and plagued with problems including limited battery life and short range.

Partnering with Panasonic, the world’s top producer of automotive batteries, could help resolve many of these issues. The companies already collaborate on batteries for Toyota’s gasoline-electric hybrids.

Foreign automakers including Volkswagen, Tesla, Daimler and a host of Chinese companies are already investing heavily in electrics. This has in turn led Toyota to join hands with Mazda to form a capital partnership including joint development of electric vehicles.

A joint venture involving the duo and autoparts maker Denso was announced in September to develop core electric-vehicle technologies.